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Three Senators Ask Attorney General Holder to Support Wire Act Rollback

On Thursday, three United States Senators penned a letter to U.S. Attorney General Eric Holder, urging him to support their efforts to roll back the Department of Justice’s (DOJ) interpretation of the Wire Act of 1961 to the old fashioned, out of touch, incorrect interpretation that was used for most of the Wire Act’s existence.

Unlike most opposition to online gambling, this letter was signed by members of both major political parties, rather than just Republicans. Two Republicans, Kelly Ayotte of New Hampshire and Lindsey Graham of South Carolina, put their names of the paper, as did one Democrat, Dianne Feinstein of California. It may not be all that surprising, though, as Sheldon Adelson, CEO of the Las Vegas Sands Corp. and online poker’s primary adversary, was able to recruit former politicians from both parties to lead his anti-online gambling lobbying organization, the Coalition to Stop Internet Gambling (CSIG). An unlimited checkbook can accomplish just about anything.

Senator Lindsey Graham

Senator Lindsey Graham

The three Senators are asking Attorney General Holder to support a bill called the Restoration of America’s Wire Act, introduced in the Senate by Graham and in the House by Representative Jason Chaffetz (R – Utah) in March. The bill, if passed, would effectively make online gambling illegal in the United States, even in states such as Nevada, Delaware, and New Jersey that have already legalized and regulated online poker.

Sheldon Adelson (and, by extension, the legislators he supports monetarily) was infuriated with the DOJ’s reinterpretation of the Wire Act back at the end of 2011. The Act was originally created to bar organized crime from running sports betting rings over telephone lines.  Even though the Wire Act explicitly states that it is sports betting that is illegal, over time the DOJ interpreted it more broadly to include all types of gambling over any telecommunication lines. In December 2011, the DOJ clarified its stance, saying that sports betting was, in fact, the only type of gambling that was not allowed over the internet and that the Wire Act had nothing to do with poker, casino games or other forms of gambling.

The Restoration of America’s Wire Act would do just what it says: restore the DOJ’s old, incorrect interpretation of the Wire Act to include all types of gambling. It is a funny goal, really. Rather than trying to author a bill that would clearly outlaw online gambling outright (rather than, say a bill like the UIGEA that runs an end-around, cutting off the money flow to i-gaming sites), Adelson and friends are saying that just because something was one way for decades that it should stay that way no matter what. Never mind that it was wrong. It’s the way it was, so it should always be that way.

To nobody’s surprise, the letter from Ayotte, Graham, and Feinstein uses many of the same scare tactics that online poker’s opponents always use, such as the fear of money laundering, criminal activity, and giving children ready access to gambling.

Here is the entire text of the letter to Attorney General Holder:

Dear Attorney General Holder:

In December 2011, the Department of Justice issued a legal opinion reversing 50 years of interpretation of the Wire Act. Lawyers there concluded the Act no longer bans gambling over the Internet as long as the betting is not on the outcome of a sporting event.

Left on its own, the DOJ opinion could usher in the most fundamental change in gambling in our lifetimes by turning every smart phone, tablet, and personal computer in our country into a casino available 24 hours a day, 7 days a week. The FBI has warned it will open the door to money laundering and other criminal activity. And, it is bound to prey on children and society’s most vulnerable. We note that a number of states are now considering authorizing Internet gambling, which poses a significant threat to states that have banned or limited gambling.

We have introduced legislation to restore the Act to the way it had been interpreted for the five decades preceding the DOJ opinion. Since you have changed DOJ’s interpretation of the Wire Act, opining that it only applies to sports-related betting, will you support the legislation we have introduced to respond to your re-interpretation of the statute?

The clock is ticking. We must act before we find virtual casinos making gambling pervasive in our society, invading living rooms, bedrooms, and dorm rooms across the country; a result we know the DOJ does not want to see.

We fully expect the Senate will act on our legislation this year, and it is our intent to do whatever we can to make that happen. With your help, and the backing of the DOJ, we are confident we can succeed in this effort.

We look forward to working with you on this matter.

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